Landlords who intend to sell their properties this year are being urged to act quickly ahead of the Capital Gains Tax allowance change announced in the Autumn Statement.
Chancellor Jeremy Hunt announced that the current allowance of £12,300 is being halved to £6,000 from April 2023 and then cut again to £3,000 from April 2024. That could mean an increased tax bill for many landlords planning to sell this year.
Andrew Parker, auctioneer and managing director at SDL Property Auctions, says CGT is charged on any 'gain' or profit you make when you sell or dispose of assets that aren't within an ISA. So - he says - landlords and second home owners are at risk of paying more come the new tax year.
Commercial properties may also be affected if you lease out any part of your property or use your home as a business premises.
Parker insists that sale by auction can help avoid the current open market completion times which can be as long as six months, and which come with a high rise of falling through.
He says: “By selling in an auction, you get a legal binding contract on the fall of the hammer with a fixed completion set for only 30 days later. That means if you sell this month or next, you can hand over the keys and have the proceeds in your account before the end of March - and thus eligible for the currently more generous CGT allowance.”
Parker insists that in a time of economic uncertainty, and with the market looking more heavily skewed against multiple property owners, auctions provide a secure sale at the best price.
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Put the money in the bank , then you get the inevitable haircut to bail out the banks - again just before the big crash
Then they nationalise the banks and you lose the lot
You not selling then George?…. Just put up with them controlling your assets
Unfortunately the CGT on one of my properties is so ridiculously high it's not worth selling
Bought in the 1950s by my now dead grandparents for peanuts , now worth millions , it's actually become a liability tbh
CGT is 28% and though too high, after costs the rest of the money is your's.
Therefore selling it should see you in healthy profit. Unless of course you have mortgaged it to fund other buy to let properties or tied up elsewhere and I then understand your situation.
A helpful article indeed 😂 as if we didn’t know ! Those landlords on this path will be selling as soon as we can.
Two auctions coming up in Norwich next month, so those that are lucky enough to get a sale will complete before April, but properties haven't been selling too well in auctions recently so it'll be a case of reducing the reserve to get that sale , chicken & egg.
So if I understand right, we're only talking 28% of £6000 more in CGT. from Apr 23
Silly article. If you sell too quick you most likely sell too cheap, especially just now when nobody is buying. My estate agent has said don't bother putting anything on the market until at least March. I'd never sell at auction although you can be lucky and get some sucker pay too much in the heat of the moment.
Agree totally, auctions are only good if you are desperate.
That's true Robert but I think there are those out there that are desperate, there are also many properties that are un mortgageable and auction is the only way out
Well I wouldn’t say 28% isn’t a significant amount on £6’000. it’s £1680.00 out of your 6’000. & next decrease coming on a further 3’000. £840. + your £1’680. = £2’520 extra tax out of your pocket, it’s adding insult to injury.
Suppose when you sell you get 100k more for a property you held for years, classed as profit that’s £28k tax on inflation really, so the confetti powerless
money you receive is no better than the original money so where is all this profit.
Forget about your personal input and the huge taxes paid year on year.
In some cases there is no personal allowance allowed.
Then 20% to £37.5k then 40% to £100k now anything over is going to be 45% to £150k not over it as before.
Ah! sure that’s lovely just add another £2’520. Capital gains to your tax Bill to keep the doss playing with their iPhones.
I suppose so, it’s a pretty sad state of affairs though that Landlords will have put Money, time and effort in, only to end up losing Money. All because of a Government that have pandered too the loony left.
I know sometimes in the past you could get more at Auction because buyers were there deal done 10% on the day and completed In 28 days usually.
I had looked at a Property Privately some years ago and minded to buy but only luke warm. So I went to an Auction for some I had viewed and the prices were mad. I was happy to jump on the tube go direct to the one for Sale by private treaty and buy. Incidentally it had been the subject of BBC Changing Rooms but that was no advantage.
George, you were lucky mine didn’t even have the peanuts.
So for many of us, property is our life’s work. We struggle to get ahead pay our taxes year on year, house millions of people the Gov won’t and underpin our local economies using many many services.
Then we are whacked by CGT now moving toward a full third of everything we own.
And we are told we are ‘greedy’. This inept Gov is inviting rebellion.
WHY do we let them get away with phrases like less generous , we should be controlling the rhetoric it is more avaricious and greedy
Likewise , levelling the the playing field , a fairer balance, giving rights to tenants, it is none of those things it is more injustice bias and discrimination and taking away any rights we have left, until we challenge their propaganda and expose their lies we always be the victims ,
Regrettably the NRLA is an irrelevance we need robust and aggressive representation NRLA are not fit for purpose anymore
Sell with an agent using auction rules
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